ABSTRACT Filamentous fungi produce a vast universe of secondary metabolites (SM) with biological activities that are of central importance for progress in medicine and agriculture. For example, fungal SMs exhibit cytostatic, immunosuppressant, lipid lowering, or antimicrobial properties. Rapid progress in sequencing the genomes of filamentous fungi has revealed a very large number of putative biosynthetic pathways with no known metabolites, suggesting a vast potential for the discovery of new compounds and activities. However, significant impediments to full characterization of fungal BGC diversity exist: (a) many SMs are synthesized by ?non-canonical? biosynthetic gene clusters (BGCs) not recognized by bioinformatic algorithms, (b) many BGCs are not expressed in standard laboratory conditions (e.g. ?cryptic? BGCs), and (c) genes for some biosynthetic pathways are not all clustered and involve more than one locus. Further, there is (d) little understanding of the genesis of functional BGCs. Our recent results clearly indicate that non-canonical BGCs reveal genuinely novel structures or unusual biochemistry, that specific fungal differentiation signals induce global BGC expression and that ?hot spots? of recombination generate BGC diversity. In this grant, we will (i) characterize isocyanide synthase (ICS) BGCs, a recently discovered family of noncanonical fungal BGCs not recognized by current software algorithms for which we have preliminary results demonstrating new and exciting biochemistry, (ii) use a fungal differentiation signal for transcriptomic identification of ?invisible' BGCs across diverse fungal taxa and (iii) address the hypothesis that genomic ?hot spots? of recombination and horizontal transfer give birth to new BGCs. Based on the premise that non-canonical gene clusters are particularly likely to produce chemical entities with a high degree of structural and functional novelty coupled with two advances able to identify active BGCs and how BGC are formed, our tool set of comparative transcriptomics, advanced endogenous and heterologous expression platforms and a recently developed platform for comparative metabolomics will provide a wealth of new structures, biosynthetic pathways, and biological activities through expansion of the biology, genetics and chemistry of fungal BGCs. Moreover, insight into BGC genesis and identification of global BGC induction signals present genuinely new processes to further the scope of fungal BGC discovery and functional annotation.